Grants from Sheraa’s US$1 million fund will be awarded to entrepreneurs focused on creating real impact.
Honoring the #UbuntuLoveChallenge, a worldwide initiative spearheaded by H.E Sheikha Bodour bint Sultan Al Qasimi and Mamadou Kwidjim Toure, founder of the Africa 2.0 Foundation, Sharjah Entrepreneurship Center (Sheraa) has pledged a US$1 million dollar solidarity fund to greatly help startups that are under strain as a result of coronavirus pandemic.
The fund, which has been issued instead of Sheraa’s annual events that won’t be taking place this season, will be distributed through equity-free grants and commissioned projects. “The precise information on the allocations, including how exactly to apply for usage of the funding, will be released in the coming weeks,” says Najla Al Midfa, CEO, Sheraa. “For the time being, we are conducting a survey to assess our startups’ needs, and where their specific challenges and fundraising requirements lie.”
The fund is founded on three pillars. Firstly, it’ll provide emergency funding by means of grants to startups, which were significantly influenced by the crisis, despite their strong business models and positive longterm outlooks. Secondly, the fund will be utilized to supply project-based contracts to startups, for services and products procured either by Sheraa or by its partners in Sharjah. Al Midfa explains a great example of this can be the recently announced partnership between Sharjah World Book Capital and among Sheraa’s startups, Kitab Sawti, who produce Arabic audiobooks. Thirdly, one area of the fund will be utilized to aid startups developing solutions that either directly address the COVID-19 pandemic, or that will assist the world thrive in the post-COVID world, such as for example startups in health tech, logistics, education, and employment.
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All Sheraa startups, Al Midfa explains, have already been forced to rationalize their cost structures, including shifting to the usage of freelancers and part-timers, which includes brought its own group of challenges with regards to choosing the best talent. Sometimes, startups experienced to entirely pivot their business models so as to survive, she says. “Sheraa’s B2B startups specifically are struggling in the COVID-19 era- contracts which already are signed are now cancelled, incurring heavy costs as well as the lack of income,” Al Midfa adds. ”3Dinova, for instance, which originally provides 3D workshops to students, has been especially influenced by the closure of schools. They now offer at-home services, and also have also expanded its offerings to greatly help university students struggling to complete their 3D design projects because of labs being closed.”
However, startups in sectors such as for example education technology, digital health and fitness, logistics, and e-commerce are seeing higher consumer activity and today face the task of maintaining the rising demand. “Investing in the proper digital and logistical infrastructure set up that may keep pace with the market’s needs is currently priority,” Al Midfa says. “Fortunately, as the pool of capital open to startups may generally have shrunk, it’s the businesses in these sectors that may most likely have the ability to attract investment, and continue steadily to grow through the post-COVID era.”
Lastly, Al Midfa highlights that the biggest effect on entrepreneurs is actually the human impact. “These uncertain times have brought with them anxieties that people have never had to cope with before, from the constant concern with physical infection, and the toll it has taken on so many lives all over the world, to the realities of lockdown and the restrictions that include it,” Al Midfa says. “Entrepreneurs are specially vulnerable because not merely are they coping with these mental and emotional traumas, however they are doing this while dealing with the effects of the COVID-19 pandemic. Founders will require a network of support to greatly help ensure they aren’t forgetting to deal with themselves in the mission to keep their businesses running.”
Al Midfa concludes with some advice for startups grappling through the COVID-19 crisis. “The truth is that entrepreneurs will have make some tough decisions in the coming weeks and months," she says. "Compared to that end, crucial and practical advice on things such as for example improving unit economics, cutting costs, finding paths to profitability, and seeking market opportunities is everywhere. But I’d also advise more startups to consider merging or partnering with other ventures where they are able to. By working together, you can not only share resources, but also share costs, reducing the responsibility throughout. If there’s a very important factor this pandemic has taught us, it really is that we are interdependent, so this is the time to build on that interconnectedness for the nice of the complete ecosystem. My other little bit of advice is always to be sure you be kind, both to yourself also to those around you. No-one was prepared because of this scenario, and we all have been coping as best we are able to. When you are struggling, then get in touch with mentors, other founders, investors, and supporters like Sheraa to require help.”